NHL set to roll out U.S. network

The launch of the NHL’s long-planned U.S. network is imminent,
as carriage deals with the largest cable and satellite operators are virtually
complete.

A deal with cable operators would place the NHL Network on
sports tiers, according to cable executives close to the negotiations. That
means the network would be available to an undetermined number of subscribers
as soon as this week for the start of the hockey season.

The biggest cable and satellite providers already started
offering the current season of the NHL’s out-of-market package, NHL Center Ice,
last week, with an early bird price of $149 through Oct. 9 for a full season.
Afterward, it will be available for $169.

Center Ice has been available to both cable and satellite
operators for the past several years, and this year’s deal is good news for the
NHL Network, since the NHL has been looking to follow Major League Baseball’s
model by tying carriage of its channel to carriage of its out-of-market
package.

Sources with the three biggest cable operators, Comcast, Time
Warner and Cox, as well as satellite operator DirecTV say they are still
negotiating to carry the network, and expect to complete a deal soon. EchoStar
wasn’t available for comment, though it appears likely that Dish Network is
close to a deal, as well, since its customer service representatives were
selling the NHL Center Ice package last week.

Putting the NHL Network on a sports tier would follow a
similar strategy to NBA TV, which accepted digital sports tier carriage several
years ago. The NBA recently has been expressing disappointment about the lack
of cable subscribers that get sports tiers. NBA TV is in less than 10 million
homes.

To combat these poor penetration rates, NHL Network plans to
make much of its programming available on demand, including some live
programming and archived content. That would give all digital cable subscribers
access to NHL Network content.

In some markets where hockey is less popular, the NHL is
considering forgoing a linear channel in favor of a straight video-on-demand
feed, cable sources said.

It’s not known how many subscribers the network will have
initially. The network is charging cable and satellite operators 21 cents per
subscriber, though that price fluctuates given the different markets and
carriage commitments.

The network will be virtually identical to the
already-established NHL Network in Canada, which has been operating for the
past six years out of Toronto and is seen in 900,000 Canadian pay TV homes. The
U.S. version of the NHL Network will feature 50 live games this season, many of
which will be different from its Canadian counterpart. It also will show the
Canadian network’s signature program, “On the Fly,” which offers news,
commentary and live look-ins to NHL games.

Eventually it will morph into more of a U.S. channel, with an
undetermined amount of programming being produced in the U.S. out of the
league’s New York office. Jody Shapiro, group vice president of Center Ice and
the NHL Network, will head up the network. Shapiro is the one handling carriage
negotiations for the channel.

“We can launch quickly because of how developed the network is
in Canada,” said NHL Commissioner Gary Bettman. “We can light it up in a matter
of days, if needed.”

As for the NHL’s other TV issue, sources say the league has
not spoken with ESPN about a media deal with the Disney company since mid-July
(SBJ, July 30). Both the NHL and ESPN say the lack of talks does not mean that
interest has cooled, as both sides say they expect talks to resume in the
coming weeks, though neither party feels a sense of urgency about these talks.

ESPN executives believe that packages could be available for
the 2008-09 season. One is NBC’s nine-game regular-season schedule plus the
playoffs. NBC, however, holds an option on that, and hockey officials are
saying they would like to keep their games on the network.

ESPN does not plan to offer time on its ABC broadcast network
in any negotiations, network sources said.

The other package involves games that are not currently
televised that the league would carve out for ESPN. The problem with this idea,
however, is that Versus holds cable exclusivity to all of the league’s games
through 2011, thanks to the $70 million deal it signed last year.

Versus would be willing to waive exclusivity for the NBC
package, but not for a new package of games.